Have you welcomed in the start of this new year with any resolutions? A recent survey revealed that more than half of the UK (54%) will be making them and while a large proportion will focus on health, the second most popular topic is around money[1].
It’s perhaps unsurprising that this is the case considering the rise in the cost of living towards the end of last year as inflation soared to 5.1%.
So how do you instil a practice of good saving hygiene in your life? Whether you’re a pro at growing your nest egg or have debts to get on top of, there are some simple ways to help your money grow.
Clear costly debts first
If you have expensive credit card or loan debts then it’s worth tackling these first.
Some people consolidate their debts to help simplify paying them off with one monthly payment. This may or may not be the best solution for your situation so it’s a good idea to seek professional advice first.
Have a goal
Labelling your savings target and setting a goal will help it to feel more real and may encourage you to stick to your savings routine. Whether it’s a new car, home renovation or something else, having it clear in your mind will encourage you on your savings quest.
If saving for a rainy day, aim for a set amount, such as at least three months’ worth of salary. This could be a useful amount to have should the unexpected happen.
Make saving a regular habit
Saving regularly helps it to feel like second nature and therefore less like you’re missing out on much-wanted disposable spending money. You could set up a direct debit from your current account to a savings account that will transfer a set amount automatically each month at a time of your choosing (after pay day, for example).
Having this amount come out before anything else could help you to budget and understand what you can spend the rest of the month.
Shop around for a great interest rate
Not all savings accounts are equal and it’s worth shopping around for the best interest rates. It’s a good idea to understand your personal savings allowance, which denotes how much tax-free interest you can earn on your savings[2].
You could check this on a comparison site such as Moneyfacts[3] or alternatively speak to a financial adviser.
Use an app
There’s an app for everything now and budgeting is no exception. Some apps can be linked to your bank account and split your money into relevant areas, such as bills, food, treats and track your savings. You can compare different features to find the best one to suit you[4].
Live within your means
We can’t stress this one enough. Living within your means is essential for saving. Avoid spending outside of your budget. Forget keeping up with the Jones’. Focus on your own goals and creating the best life for you in a sustainable way.
